MIRA INFORM REPORT

Report Date :

06.03.2008

IDENTIFICATION DETAILS

Name :	FLAMINGO PHARMACEUTICALS LIMITED
Registered Office :	7/1, Corporate Park, Post Box No. 27257, Sion - Trombay Road, Chembur, Mumbai - 400 071, Maharashtra
Country :	India
Financials (as on) :	31.03.2007
Date of Incorporation :	12.06.1985
Com. Reg. No.:	11-36572
CIN No.: [Company Identification No.]	U51900MH1985PLC036572
TAN No.: [Tax Deduction & Collection Account No.]	MUMF03725B
PAN No.: [Permanent Account No.]	AAACF4211B
Legal Form :	Closely Held Public Limited Liability Company
Line of Business :	Manufacturing of pharmaceutical products such as Tablets, Capsules, Dry Syrups and Injectibles.

RATING & COMMENTS

MIRA’s Rating :

A

RATING		STATUS	PROPOSED CREDIT LINE
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large

Maximum Credit Limit :	USD 1500000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established company controlled and managed by Thacker family. It is engaged in the business of manufacturing and marketing of Pharmaceutical Formulations in the form of Tablets, Capsules, Syrups, Injectables, etc. The company’s profitability is under pressure on account of increase in overheads, interest payment, etc. However, it is optimistic about future growth. Trade relations are reported as fair. Payments are usually made as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

LOCATIONS

Registered Office :	7/1, Corporate Park, Post Box No. 27257, Sion - Trombay Road, Chembur, Mumbai - 400 071, Maharashtra, India
Tel. No.:	91-22-25234120 / 25235242 / 43 / 45
Fax No.:	91-22-25233085 / 25246837 / 55975249
E-Mail :	ashf@giasbm01.vsnl.net.in
Website :	http://www.flamingopharma.com
Factory 1 :	R-662, T.T.C. Industrial Area, Rabale, Navi Mumbai - 400 071, Maharashtra.
Tel. No.:	91-22-27695593/27696998/27694571/27902397/27603835
Fax No.:	91-22-27693844
E-Mail :	mailfplrbl@vsnl.net.in
Factory 2 :	E-28, Taloja Industrial Area, Taloja, Raigad – 410 208, Maharashtra
Tel. No.:	91-2145-27695593/27696998/27901782/27902742
Fax No.:	91-2145-27693844/27902743
E-Mail :	mailfpltlg@vsnl.net.in

DIRECTORS

Name :	Mr. Ashwin Jethalal Thacker
Designation :	Chairman and Managing Director
Address :	154-B, Shiv Enclave, Sindhi Society, Chembur, Mumbai – 400071, Maharashtra
Date of Birth/Age :	13/10/1989
Qualification :	B. Sc. (Hons), DBM, DMM (Bom)
Date of Appointment :	23/06/1986
Previous Employment:	Haria Export Limited - Export Executive (4 ½ years)
Name :	Mr. Jethalal Khatau Thacker
Designation :	Director
Address :	154-B, Shiv Enclave, Sindhi Society, Chembur, Mumbai – 400071, Maharashtra
Date of Birth/Age :	29/01/1927
Date of Appointment :	22/12/1986
Name :	Mr. Deepak B. Goradia
Designation :	Director
Address :	806, Somnath Neelkant Valley, Rajawadi, Ghatkopar (East), Mumbai – 400077, Maharashtra
Date of Birth/Age :	09/04/1956
Date of Appointment :	03/09/1997
Name :	Mr. Rohit Rajpal Puri
Designation :	Director
Address :	29, Udayagiri Co-operative Housing Society, Opp-Telecom Factory, Sion-Trombay Road, Deonar, Mumbai – 400088, Maharashtra, India
Date of Birth/Age :	05/05/1955
Date of Appointment :	03/09/1997

KEY EXECUTIVES

Name :	Mr. Parambadi Madhavan Nair
Designation :	Company Secretary
Address :	215/5779, Darshan, Pant Nagar Hig Scheme, 90 Feet Road, Ghatkopar [East], Mumbai – 400075, Maharashtra, India

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

Names of Shareholders	No. of Shares
Mr. Ashwin Jethalal Thacker	1387800
Mr. Jethalal Khatau Thacker	4470
Mrs. Raju A. Thacker	631800
Equity Share Breakup
Category	Percentage of Holding
Bodies corporate	0.33
Directors of relatives of directors	99.67
Total	100.00

BUSINESS DETAILS

Line of Business :	Manufacturing of pharmaceutical products such as Tablets, Capsules, Dry Syrups and Injectibles.
Products :	> Tablets > Capsules > Dry Syrups > Injectibles
Exports :
Countries :	Belgium, Germany and UK

PRODUCTION STATUS

Particulars	Unit	Installed Capacity
Tablets	In lakhs	18009
Capsules	In lakhs	5793
Dry Syrup	In lakhs	108
Injectibles	In lakhs	211

GENERAL INFORMATION

No. of Employees :

50

Bankers :

Ø State Bank of India Overseas Branch, Cuffe Parade, Mumbai, Maharashtra Ø Canara Bank Sindhi Society Branch, Chembur, Mumbai, Maharashtra Ø HDFC Bank Limited Dr. D. N. Road, Mumbai, Maharashtra Ø ICICI Bank Limited ICICI Tower, Bandra-Kurla Complex, Mumbai, Maharashtra Ø Export Import Bank of India Centre 1, World Trade Centre, Cuffe Parade, Mumbai, Maharashtra Ø Times Bank Limited Dr. D. N. Road, Mumbai, Maharashtra Ø State Bank of India Madame Cama Road, Mumbai – 400021, Maharashtra, India Ø Central Bank of India, Mahatma Gandhi Road, Mumbai – 400023, Maharashtra, India

Banking Relations :	Satisfactory
Auditors :
Name :	Pravin Sarvaiya and Company Chartered Accountants
Address :	5, Kermani Building, 1^st Floor, Sir P. M. Road, Fort, Mumbai – 400 001, Maharashtra, India
Tel. No.:	91-22-2852344
Associates/Subsidiaries :	Minimed Laboratories Private Limited Rotaline Limited

CAPITAL STRUCTURE

Authorised Capital :

No. of Shares	Type	Value	Amount
10,000,000	Equity Shares	Rs. 10/- each	Rs. 100.000 Millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
2,268,000	Equity Shares	Rs. 10/- each	Rs. 22.680 Millions

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2007	31.03.2006	31.03.2005
SHAREHOLDERS FUNDS
1] Share Capital		22.680	22.680	22.680
2] Share Application Money		0.000	0.000	0.000
3] Reserves & Surplus		356.875	303.582	292.797
4] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		379.555	326.262	315.477
LOAN FUNDS
1] Secured Loans		473.933	376.848	381.994
2] Unsecured Loans		19.000	17.500	17.500
TOTAL BORROWING		492.933	394.348	399.494
DEFERRED TAX LIABILITIES		39.813	36.056	30.899
TOTAL		912.301	756.666	745.870
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		463.172	433.964	418.225
Capital work-in-progress		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	323.273	236.867	192.165
	Sundry Debtors	304.240	214.333	171.238
	Cash & Bank Balances	6.100	9.204	10.258
	Other Current Assets	0.000	0.000	0.000
	Loans & Advances	83.193	93.611	72.441
Total Current Assets		716.806	554.015	446.102
Less : CURRENT LIABILITIES & PROVISIONS
	Current Liabilities	276.161	234.219	117.992
	Provisions	11.468	4.387	0.465
Total Current Liabilities		287.629	238.606	118.457
Net Current Assets		429.177	315.409	327.645
MISCELLANEOUS EXPENSES		19.952	7.293	0.000
TOTAL		912.301	756.666	745.870

PROFIT & LOSS ACCOUNT

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
Sales Turnover		1229.671	856.596	633.823
Other Income		2.894	16.910	18.711
Total Income		1232.565	873.506	652.534
Profit/(Loss) Before Tax		70.005	0.207	3.493
Provision for Taxation		12.833	7.345	3.189
Profit/(Loss) After Tax		57.172	[7.138]	0.304
Earnings in Foreign Currency :
Total Earnings		NA	842.205	613.777
Imports :
	Raw & Packing Materials	NA	107.305	119.899
	Capital Goods	NA	1.050	0.000
Total Imports		NA	108.355	119.899
Expenditures :
	Raw Material Consumed	781.476	538.865	423.709
	Personnel Expenses	0.000	0.000	44.277
	Purchases made for re-sale	53.666	8.293	0.000
	Consumption of stores and spares parts	5.854	3.564	0.000
	Increase/(Decrease) in Finished Goods	[56.724]	45.690	0.000
	Salaries, Wages, Bonus, etc.	68.696	43.414	0.000
	Managerial Remuneration	1.080	1.080	0.000
	Payment to Auditors	0.375	0.224	0.000
	Interest	33.591	23.192	20.304
	Insurance Expenses	5.964	3.437	0.000
	Power & Fuel	37.943	26.562	0.000
	Depreciation & Amortization	28.044	24.211	22.934
	Other Expenditure	202.595	154.766	163.177
Total Expenditure		1162.560	873.298	674.401

KEY RATIOS

PARTICULARS		31.03.2007	31.03.2006	31.03.2005
PAT / Total Income	(%)	4.64	[0.82]	0.05
Net Profit Margin (PBT/Sales)	(%)	5.69	0.02	0.55
Return on Total Assets (PBT/Total Assets}	(%)	5.93	0.02	0.40
Return on Investment (ROI) (PBT/Networth)		0.18	0.00	0.01
Debt Equity Ratio (Total Liability/Networth)		2.06	1.94	1.64
Current Ratio (Current Asset/Current Liability)		2.49	2.32	3.77

LOCAL AGENCY FURTHER INFORMATION

HISTORY

Subject was incorporated on 12^th June, 1985 at Mumbai in Maharashtra having Company Registration Number 36572.

The company was originally incorporated under the name and style of Flamingo Impex Private Limited and converted into public limited liability company on 30^th June, 1994. Further the name of the company was changed to the present on 25^th September, 1995.

It’s products range include:-

· Tablets

· Capsules

· Dry Syrup

· Liquid Syrup

· Injection-Sterile Dry Powder

· Liquid Injections

· Dosage Form – Tablets

· Dosage Form – Capsules

· Dosage Form – Injection

· Dosage form – Dry Powder for Suspension

It is in trade terms with :-

² Medral GmbH, Germany

² Pharm Inter Sprl, Italy

² Exphar S.A., Belgium

² M. S. Chemical, Italy

² Ita Lab Private Limited

² Geo Chem Laboratories (Rajkot) Private Limited

² Regal Pharmaceuticals Limited

² Dilip Traders

² Oboi Laboratories

² Elys Chemicals Industries Limited

² Jain Exports

² Minimed Laboratories Private Limited

The company spans some of the largest therapeutic segments in the Health-Care industry, using a selective product mix. From Tablets to Capsules and from Dry Powders for syrups to Dry Powder Injectables, the company can display an extensive list of products. The range of products in capsules form covers : Anti-bacterial, Chloramphenicols, Macrolides, Penicillin in different strengths and packing. Penicillin products are manufactured in a separate area. A wide range of syrups are manufactured in the Dry Syrup department : Dry Powder suspensions such as Ampicillin, Amoxycillin, Cloxacillin, Cefalexin, etc.

Erythromycin, Cotrimoxazole, Paracetamol and Metronidazole. Syrups are packed in P.E.T. or glass bottles, which in turn are packed individually in cartons with measuring cups and leaflets. Injectables included in the product range are Penicillins, Cephalosporins, Chloramphenicols, Kanamycin and Aminoglycoside.

Fixed Assets

• Leasehold Land
• Factory Building
• Office Premises Building
• Plant & Machinery
• Furniture & Fixtures
• Office Equipments
• Vehicles

Bankers Charges Report as per Registry

This form is for	Creation of charge
Corporate identity number of the company	U51900MH1985PLC036572
Name of the company	FLAMINGO PHARMACEUTICALS LIMITED
Address of the registered office or of the principal place of business in India of the company	7/1, Corporate Park, Post Box No. 27257, Sion - Trombay Road, Chembur, Mumbai - 400 071, Maharashtra
Type of charge	Movable property
Particular of charge holder	Export Import Bank of India Centre One, Floor 21, World Trade Centre Complex, Cuffe Parade, Mumbai – 400005, Maharashtra, India eximoif@vsnl.com
Nature of description of the instrument creating or modifying the charge	Unattested deed of hypothecation of movable fixed assets dated 23 February 2007, Executed by flamingo pharmaceuticals limited in favour of Export Import Bank of India
Date of instrument Creating the charge	23.02.2007
Amount secured by the charge	Rs. 50.000 Millions
Brief particulars of the principal terms an conditions and extent and operation of the charge	Rate of Interest The per annum rate equal to Exim Bank’s PLR less a spread of 1.75 % subject to minimum of 9.75 % p.a. payable the borrower with monthly rests on 20^th day of each month each year. Provided however Exim Bank shall be at liberty to revise th spread on PLR and Provided further that interest rate shall be subject to reset in accordance with provisions of the loan agreement. Terms of repayment The Rupee loan shall be repaid by the borrower in 16 substantially equal quarterly installments commencing at the end of one year from the date of first disbursement. Extent operation of the charge The charge created by the aforesaid deed of hypothecation shall operate as a continuing security by way of first pari-passu charge for repayment by the borrower to Exim Bank of the loan of Rs. 50.000 Millions The said charge shall bank in the order of property set out in schedule IV to the deed of hypothecation.
Short particulars of the property charged	Movable plant and machinery, equipment, appliances, furniture, vehicles, machinery, spares and stores, tools and accessories, whether or not installed and Related movable in the course of transit or delivery whether now belonging to borrower or which maybe held by any person at any place within or outside India to the order disposition of borrower and all documents or title including bills or landing, shipping documents, polices of insurance and other instruments.

AS PER WEBSITE

Introduction

They are one such rare company that has drawn the attention of many in Indian pharmaceutical industry, because, in the times when other Indian companies are striving to reach global customers and achieve standards for global presence, they already have an impressive and impeccable achievement of having their wings of success spread all across the globe in as many as 50 countries world wide, by achieving and maintaining global healthcare standards backed by their contemporary marketing strategies.

They are now marching ahead in India with their key customer specialties and therapeutic areas, for ensuring that every Indian is benefited with their global expertise of quality healthcare. Their business objective is to achieve leadership in key therapeutic areas. They operate with innovative and advanced formulations for notable therapeutic benefits, thereby, achieving a value turnover of 3000 Millions INR in the next three years of operation.

Milestones

Started in 1986 as Flamingo Impex Private Limited as trading company by Ashwin Thacker , with export of branded and generic formulations to East Africa . Ashwin Thacker is a science graduate from Bombay university with post graduate specialisation in marketing management.

1988 - Commenced Trading Operations in pharmaceutical formulations in Europe

1991 - Commenced exporting formulations to South East Asia and Central America

1995 - Started manufacturing unit - Rabale - on the outskirts of Mumbai

1997 - Received WHO GMP status for the Rabale facility

1998 - Received ISO 9000 status for the Rabale facility

2001 - Started second manufacturing facility in Taloja (in the Raigad district) for regulated markets

2003 - Received WHO GMP accredition for the Taloja facility

2004 - Received plant approval from Uganda, Zimbabwe for the Taloja facility

2005 - Received UK MHRA approval for the Taloja facility

2005 - Received IDMA quality excellence award for the Taloja manufacturing facility

2006 - Received 100% EOU certification for the Rabale and Taloja manufacturing facilities

2006 - Successfully launched Domestic Division

2007 - Received plant approval from Ethopia and Yemen (GCC countries)

Domestic Operations

In the first year of their domestic operations, they intend to extend the benefit of their world class products to significant number of patients with the help of sales force of approximately 500 Managers and Officers across India. Their launch operation has already started in the state of Uttar Pradesh, Andrapradesh, Maharahstra, Jammu & Kashmir, Rajsthan, Bihar, Karnataka and Tamilnadu. By mid-end of year 2007, they will be operational all across the country.

Flamingo has a wide range of generics and branded Quality Pharmaceutical Products for both regulated and semi-regulated markets.

Flamingo currently in its Domestic Division engages 300 employees – all experienced and competent in the field of pharmaceutical marketing and sales.

Their products are a outcome of highly advanced manufacturing facilities supported by advanced well equipped Laboratory facilities, Analytical Method Development, and sophisticated R&D departments.

Their Quality level is no mere coincidence. They aim at safeguarding quality and delivering products that match their clients expectations and needs.

They follow international and national regulations. Their facility is approved by WHO-GMP, MHRA, and RSSL

The company recognized as a prestigious Export House by the Government of India. This is a distinction conferred upon only selected companies with proven track record in the international markets.

Since its formative years, the company has strived to establish a firm foothold in the highly competitive Pharma Industry. This, they achieved, by creating the perfect blend of a professional business approached with the caring human touch. Their, meticulous planning, focused team effort instant innovations helps them to achieve impressive year after year.

Subject has been recognised as a prestigious Export House by the Government of India. This is a distinction conferred upon only selected companies with proven track record in the international market.

Since its formative years, the company has strived to establish a firm foothold in the highly competitive pharma industry. This it achieved, by creating the perfect blend of a professional business approach with the caring human touch. Their meticulous planning, focused team effort and instant innovations help to achieve impressive growth year after year.

It has a professional expert group of 30 pharmaceuticals, 15 Post Graduate pharmacists, 5 doctors and a number of other qualified personnel in production team.

Their marketing set up consists of 20 management experts with specialisation in exports, are fully geared to service the vast clientele all over the world.

With this vast pool of resources at their disposal, the company is fully immersed in the business of manufacturing and marketing latest pharmaceutical formulations catering to a wide variety of therapeutic catagories across, the globe. Its’ business clientele from 50 countries from Europe, Africa, South America, Southeast Asia and New Zealand spans five continents of the globe.

“Quality Medicines at Affordable Prices” had been the company’s motto for the past few years. Being quality driven had brought the prestigious ISO 9002 certification and also the WHO GMP certification for own manufacturing facility.

To meet the growing demands of clientele, they are in the process of setting up a world class pharma plant at Taloja Industrial Area in Navi Mumbai with excellent infrastructural facilities at par with the international standards. The company has earmarked an investment of about 5 Mio USD for this prestigious project. One of its kind in Asia.

Subject is an organisation in tune with the current trends and the growing technological expertise in its chosen field.

Tapping into this knowledge, they had consciously invested capital and efforts, to create global class manufacturing facilities.

Their manufacturing site at Mumbai, in India, is a picture of the optimum blend of production and the most stringent quality control procedures.

CMT REPORT (Corruption, Money Laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

6] Records on Int’l Anti-Money Laundering Laws/Standards :

Charges or investigation registered against subject: None

7] Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

8] Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

9] Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

CONTRAVENTION

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.40.29
UK Pound	1	Rs.79.97
Euro	1	Rs.61.23

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	6
OPERATING SCALE	1~10	6
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	8
--PROFITABILIRY	1~10	5
--LIQUIDITY	1~10	8
--LEVERAGE	1~10	8
--RESERVES	1~10	7
--CREDIT LINES	1~10	6
--MARGINS	-5~5	-
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	NO
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		60

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
NR		In view of the lack of information, we have no basis upon which to recommend credit dealings	No Rating

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions